S7: Managing the international marketing mix Flashcards
What are the levels of a product, and why are they important in international marketing?
The levels of a product include the core product, actual product, and augmented product. They are important for understanding the various aspects and benefits of a product.
What considerations are essential when developing new products for international markets?
Cultural preferences, regulatory requirements, and market demands in different countries.
Explain the concept of the product communication mix.
The product communication mix involves the various elements used to communicate a product’s features and benefits, including advertising, promotions, and public relations.
Define price and explain its significance for organizations, customers, and the market.
For organizations, price is a revenue creator and a signal. For customers, it contributes to determining value, and for the market, it serves as a benchmark or constraint.
What are the determinants of price in the international context?
Currency fluctuation, additional costs (shipping, insurance, distribution, tax), company’s performance in the host country, and foreign market entry mode.
Describe extension pricing and its characteristics.
Extension pricing maintains the same per-unit price worldwide, regardless of the buyer’s location. Importers may need to absorb freight and import duties, but it may fail to respond to each national market.
What is adaptation or polycentric pricing, and what challenges does it present?
Adaptation or polycentric pricing allows affiliate managers or independent distributors to set prices based on their circumstances. It is sensitive to market conditions but creates potential for gray marketing.
Explain geocentric pricing and its characteristics.
Geocentric pricing is an intermediate course of action that recognizes the relevance of several factors to pricing decisions, considering both local and global factors.
List some concerns raised by gray marketing.
Dilution of exclusivity, losing direct contact with end-customers, free riding, damage to channel relationships, and undermining segmented pricing schemes.
What are the international pricing issues associated with export price escalation?
Export price escalation involves increased costs due to factors like shipping, taxes, and distribution, affecting the final price in the international market.
Differentiate between marketing-skimming and market-penetration pricing strategies for new products.
Marketing-skimming involves setting high initial prices to ‘skim’ revenues, while market-penetration sets a low price to attract a large number of buyers and gain market share.
